In the way between Tingwall and Scalloway, there is an high stone standing in form of an obelisk as some ancient monument, concerning which the people have various traditions, some saying that in the Strath of Tingwall, where this stone is erected, there was a bloody fight between the Danes and the old inhabitants or natives of this country, and that the Norwegian or Danish general was killed in this place, where the stone is set up.
Others report that one of the Earls of Orkney had a profligate and prodigal son, who for this cause being animadverted upon by his father, fled to Zetland, and there built a castle or a strong house for himself within a loch at Stroma, within two miles of Tingwall to the west, the ruins whereof are yet to be seen: his father not being satisfied with his escape, and the way he took for his defence, sent from Orkney four or five men to pursue him, to whom he gave orders that they should bring his son to him either dead or alive: the son thereupon not finding himself safe enough in his castle, made his escape from the castle, where the pursuers lay in ambush, but was overtaken by them in the Straith of Tingwall and killed there, whereupon this monument was erected. The pursuers took off his head, and carried it with them to his father, but in so doing they were so far from gratifying of him, that he caused them all to be put to death, notwithstanding of the orders given by him.
From Brand's 'A Brief Description of Orkney, Zetland, Pightland-Firth and Caithness' (from I think 1701 originally, but I found it in 'A general collection of the best and most interesting voyages and travels in all parts of the world', which was put together by John Pinkerton in 1809 - you can read it on Google Books.)
The narrator has just visited the kirk of Tingwall when something catches his eye:
The novelty, however, engaged our attention most particularly, and we were at a loss to conjecture for what purpose it stood in its place. It was a large, erect, quadrangular stone, which, if cleared from a heap of rubbish that surrounded its base, might have measured in height six feet and upwards; but its irregularly fractured summit seemed to say, that formerly it had reared a prouder crest beside the waters of the Tingwell.
An oblique vein, of a different kind of stone, traversed its centre, and an old man, approaching from some cottages that were situated at the feet of the hills, informed us, with a look of doubt, that he had heard that a "sealgh" or sea-horse, having been fastened with a rope to the "Standing Stane," the efforts of the animal to get loose had impressed that mark around it.
He likewise told us, that there had been a large flat stone lying near the upright pillar, which was said to have covered the bones of the "overseer" of Scalloway Castle, who was interred here; but he assured us, that after breaking the slab to pieces, to form the contiguous mull, he had sought in vain for remnants of mortality.
There was a look of peculiar originality in the face and person of our ancient informant, as well as a singular tone in his voice, and while he conversed with William, I included his portrait in a sketch I took of the Standing Stane, which being completed, we again set forward, with the unwelcome intelligence that the town we sought was "twa moils mair ahead."
From 'Tales of a voyager to the Arctic ocean' by Robert Pierce Gillies (1826).
There is a photo on the RCAHMS site here - perhaps you can see the traces of the sea-horse's struggle.